A new report published by the Society of Actuaries (SOA) throws into sharp detail the challenges faced by the U.S. multiemployer pension system. Speaking about the report, Lisa Schilling, retirement research actuary for the SOA, quickly pointed out that there are many multiemployer pensions that are healthy and more or less entirely financially fit. In fact, there are more than 1,200 multiemployer pension plans in the United States today, covering about 10 million participants, including roughly 4 million retirees. However, [...]

Some union retirees could see their pension benefits cut by 90 percent, Pension Benefit Guaranty Corporation Director Tom Reeder warned today. A retiree getting $8,000 annually now could be cut to less than $1,000.That is a danger, cautioned Reeder, if Congress doesn’t act soon to shore up troubled multiemployer union pension plans and the PBGC’s insurance program that backs them up. A multiemployer pension plan is typically a workplace retirement savings program created by a union and companies in [...]

We are approaching a crisis that threatens the retirement future of millions of hardworking middle-class Americans. Today, Wednesday, this assessment will be confirmed in testimony by the director of the Pension Benefit Guaranty Corporation (PBGC), Tom Reeder, before the House Committee on Education and the Workforce. Director Reeder will detail the systemic issues threatening multiemployer pension plans and argue for raising PBGC premiums. While it is encouraging that Director Reeder and Congress recognize the need for immediate and decisive action to [...]

The law of unintended consequences is once again in evidence 10 years after the passage of the Pension Protection Act of 2006. The PPA was passed to bolster the stability of defined benefit plans and the Pension Benefit Guaranty Corp. Instead, its greatest impact was on defined contribution plans, and it might have hastened the demise of the defined benefit plans it was designed to strengthen. The outcome is a reminder that legislators must not consider just the results [...]

Like many pension-related laws, the Pension Protection Act that passed a decade ago was designed to address a crisis. At the time, underfunded pension plans were threatening the financial stability of the Pension Benefit Guaranty Corp. But while the act did help strengthen the federal agency, it also had the unintended effect of discouraging defined benefit plan sponsors and hastening the switch to defined contribution plans, observers say. “It was sold on the basis that we were going to [...]

The following statement was released today by North America's Building Trades Unions in reaction to a proposed increase in Pension Benefit Guaranty Corporation (PBGC) premiums for multiemployer plans as part of President Obama's FY 2017 budget proposal: "North America's Building Trades Unions are united in vigorous opposition to the PBGC tax increase being imposed on working families through President Obama's FY 2017 budget proposal. "The PBGC premium increase, if enacted, would result in a de facto five-fold tax increase on American workers, [...]

The PBGC’s multiemployer pension plan program got three more projected years of grace before running out of money, primarily due to increased premiums dictated by the Multiemployer Pension Reform Act of 2014, according to the agency’s FY 2014 Projections Report released Monday. The single-employer program projections show continued improvement, with solvency in the next 10 years. The report is an annual actuarial evaluation based on a range of estimates of the future status of insured pension plans and their [...]

A recent rule change has resulted in the Pension Benefit Guarantee Corporation(PBGC) guaranteeing 401(k) balances that are rolled into eligible pension plans. What this means is that if a company offers a pension plan 401(k) balances can be rolled over into the pension and the pension benefit that would result from the rolled over balance will be guaranteed by the PBGC just like the original pension benefit prior to the rollover. This will only impact folks whose employer offers both types of plans. [...]

In 2013, the Saradha Group financial scam threatened to bring down the ruling government in West Bengal. The group ran fraudulent investment sch emes, collecting thousands of crores from lakhs of investors, promising astronomical 50% returns. However, it did not use investors’ money to build assets, but took it from new investors to pay the older ones. It was a classic example of a Ponzi scheme. It is ironical that while governments try to stem such fraudulent investment structures, [...]

Regulators are looking for input from stakeholders in the multiemployer retirement plan industry before issuing guidance about the recently passed Multiemployer Pension Reform Act of 2014 (MPRA). In a request for information (RFI) from the Pension Benefit Guaranty Corporation (PBGC), the agency is asking for input about expanded rules for partitions and mergers of multiemployer plans. Section 122 of MPRA replaced the multiemployer partition rules under Section 4233 of the Employee Retirement Income Security Act (ERISA) with new rules. [...]

Servicemarks

Lifetime Income Security Account (LISA) is a service mark of CORPaTH. Guaranteed Lifetime Income Account (GLIA) is a servicemark of CORPaTH. CORPaTH is a SAGE Solution: Sustainability Advocacy Governance and Education. CORPaTH is a Joint Labor Management Initiative.